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On Demand Summit 2016: Programmers, Distributors Look to Monetize Content in Lighter Ad Environment

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New York – As consumers increasingly stream video and avoid traditional ads, programmers and distributors continue to search for ways to monetize content, experimenting with sponsorships, imbedding ads in programming and branded content, according to a panel discussion at the Multichannel News/B&C On Demand Summit here Thursday.

Roku vice president of advertising Scott Rosenberg said finding new ways to place ads in, around and between content is becoming increasingly important as viewing habits shift. And he added as over-the-top and subscription video on demand services like Netflix, Amazon Prime and Hulu proliferate, consumers are increasingly looking for value.

Rosenberg said “free channels” and “free content” are the No. 1 search terms on Roku’s platform.

“As the consumer moves more and more of their time to the OTT streaming model, they’re looking for value,” Rosenberg said. “The ad model has a lot of potential.”

He added that viewers willing to watch ads for less expensive content are “more empowered,” but he added that the traditional method of large blocks of TV ads won’t cut the mustard.

“The equilibrium is going to shift,” Rosenberg said. “We’re not going to head back to traditional ad loads.”

Canoe head of business development, sales & marketing Chris Pizzurro said the consortium has been working with its cable operator partners to determine just when enough is enough for consumers when it comes to ad loads.

Pizzurro said Canoe tried to find at what point viewers would drop a show because they felt there were too many ads.

“We settled on four ads per pod,” Pizurro said. “That seems to be the sweet spot.”

MEC Wavemaker head of content Chet Fenster said that as consumers get more used to watching content without ads, it gets harder to reach them with a traditional message.

“Our business is evolving from an interrupted ad on a hit show to partnering with a big show on a platform that you normally couldn’t reach a consumer,” Fenster said.

That includes things like sponsorships, imbedding ads within shows and creating branded content.

Fenster isn’t a huge fan of the latter, but praised Pepsi’s attempts at branded content through its Soho-based studio The Creative League. Pepsi plans to offer a steady stream of branded and unbranded content from the studio and has enlisted the help of tennis star Serena Williams, actress Meryl Streep and hip-hop musician Usher for several projects.   

“It takes a lot of effort and a lot of money to get there,” Fenster said of branded content. “I’m not bullish unless you’re doing it very quickly or have superstar talent behind it.”